September 25, 2008

Host: Ted Simons

Proposition 202: Employer Sanctions

We end our series on propositions with a debate about Proposition 202, the employer sanctions initiative. The new initiative is intended to be more friendly to employers caught hiring illegal aliens. It would also make other constitutional changes, such as expanding the crime of identity theft.

Guests:

Herbert Kaufman - Professor, W.P. Carey School of Business, Arizona State University

Jessica Pacheco - Supports Proposition 202

Don Goldwater - Againts Proposition 202

Category:

View Transcript

Ted Simons:
>> Tonight on horizon: have lawmakers in Washington come to an agreement on a bailout for banks and mortgages? We will have the latest on the high level negotiations. And hear from a former Fannie Mae economist about the proposed bailout. We continue our series on the ballot propositions with a look at proposition 202, which would make some changes to the employer sanctions law. And hear from the director of the state homeland security department on being prepared for a disaster. That's next on horizon.

Announcer:
>>Horizon is made possible by contributions from the friends of eight, members of your Arizona PBS station. Thank you.

Ted Simons:
>> Good evening and thanks for joining us tonight on Horizon. I'm Ted Simons. Earlier today it sounded like there was an agreement in place to pass a rescue plan for the nation's financial system. But after a white house meeting between lawmakers and president bush, it is clear there are strong disagreements. Meetings have gone on for six days on the $700 billion package, and it looks like it will now go into day number seven. Here to talk about the bailout plans from his perspective as a former economist for Fannie Mae is Arizona state university professor Herbert Kaufman from the W.P. Carey School of Business. Thank you so much for joining us.

Herbert Kaufman:
>> I'm glad to be here.

Ted Simons:
>> Let's talk about the bailout in general terms here. The average Joe and Jane, how does the bailout affect them?

Herbert Kaufman:
>> Well, the problem we had in the system -- and we have in the system at the present time -- is a lack of credit availability and the free flow of credit in the financial system. The average person does see that in terms of the difficulty of getting mortgage loans, car loans. But in general our overreaching concern is that if the financial system continues to be very frozen or if it freezes up worse than it is now, credit availability to their employers, to the people that give them jobs, to the retail merchants that sell them stuff, to their own income stream, is going to be not available and as a result of that we're going to be in serious economic trouble.

Ted Simons:
>> So what happens if the bailout plan -- again we're talking about the bailout plan as if this is a measure, a good thing or at least something to grease the skids so to speak. What happens if it doesn't work?

Herbert Kaufman:
>> Well, that's the $24,000 question of $64,000 question or $700 billion question in particular. This is really our try at getting something to work. I don't think there is a fallback. So I do think it will work. I do think it will not be as costly as $700 billion nearly after everything is said and done based on previous experience with similar kinds of operations, albeit smaller in amount. I think that it is work. Do I not want to contemplate the fact that it won't if it's implemented. Assuming it is implemented and it doesn't work, then we're going to see how severe the adjustments are going to be. And I fear that they will be substantial, both in the financial system and in the real economy.

Ted Simons:
>> There seems to be a growing chorus of folks especially on capitol hill but all across the country that just simply don't like this whole idea of a bailout period. What do you say to that?

Herbert Kaufman:
>> Well, I don't say they like it, either. I wish we hadn't been in a position where we had to execute this. Given that we are in this current position, it is what it is. And we have to take action. And the only player at this moment that can take action is the federal government. So ideologically i don't think this is the most wonderful thing either. It can be done very cleverly, however. And i trust that it will be done cleverly so as to minimize the actual ultimate hit to the taxpayer. I don't like it ideologically. I understand why there's opposition to it. But given what i understand about the financial says term and the connection between the financial system and the real economy, do i not think we have any choice.

Ted Simons:
>> Okay. Let's say it passes and we're moving in that direction. We're off and running now. How long before we see results and what do we see? What are the first indications that it's working?

Herbert Kaufman:
>> Well, I think that there's going to be an immediate psychological benefit to the whole system. We have credit not available in many cases. We have liquidity building up in financial institutions that simply will not lend to anybody else because they're fearful either of the credit of the other person or the other institution that's on the other side, or they're fearful that assets they have on their books that are really not very good will have to be written down so much that they will need the excess funds just to stay alive. I think this will free that up. So I think we'll see an immediate psychological kick. But the real kick in terms of starting the credit wheels greased, as you put it before, getting it really going, is going to take place over certainly months if not a year before we see major, major impact. But we should see impact already from almost the get-go with regard to what we call credit spreads in the market which indicate how much risk there is. I expect those to come down fairly quickly.

Ted Simons:
>> When we see impact, is that going to get us to where we are now? And a lot of folks think we're in a recession right now. Or will that somehow supercede the rescission leap frog and things will be just beautiful from then on?

Herbert Kaufman:
>> Well, that's a little pollyanna-ish. The fact is we are in my view in a recession. It's going to take awhile to get out of this. I expect us to bump along the bottom if this is passed for awhile. And maybe it won't get much more severe than it is now. In failure to pass this, the failure to implement something like this i fear will cause a much more severe recession. So we're not exactly looking between goldilocks and the bear, okay? We're actually looking between the big bear and the little bear.

Ted Simons:
>> All right. Well, let's hope one of them is just right. [Laughter]

Herbert Kaufman:
>> Very good.

Ted Simons:
>> Thank you. Thank you for joining us. We appreciate it.

Herbert Kaufman:
>> My pleasure.

Ted Simons:
>> All right. Now we continue our series to help you understand the propositions that will be on this November's ballot. Tonight, we take a look at proposition 202, which would make changes to Arizona's employer sanctions law. We'll hear from people on both sides of the issue, but first, here's more on Proposition 202.

Mike Sauceda:
>> Proposition 202 is a business-backed initiative that would make changes to current law regarding sanctions for those who knowingly or intentionally hire illegal immigrants. Problem 202 sets up as with current law two levels of violations. Those knowingly hiring illegal immigrants under 202 can have their business license suspended for no more than 10 days and will be placed on three years probation and must sign an affidavit saying all illegal employees have been fired. That's the current law. Intentionally hiring an illegal immigrant during a 5-year period the business license will be on probation until all illegal employees have been fired. The business will be placed on a five-year probation. The court will be required to suspend the business license of a business for an intentional violation of 10 days. For knowingly or intentionally hiring an illegal immigrant during the probationary period the license would be revoked at the current location. Prop 202 would give employers an iron-clad defense if they used e-verify or i-9 forms. Current law does not give an iron-clad defense with the use of i-9 forms. Prop 202 would expand the penalty for identity theft for getting a job, unlike current law. Prop 202 also has provisions to go against employers with four or more workers who pay in cash and fail to pay workers compensation benefits or report the hiring of that person to the state. An employer in violation of any of those provisions would pay triple the amount the employer failed to pay or $5,000, whichever is more. Current law has the same provisions except they apply to companies with two or more works. Prop 2302 prohibits anonymous complains against employers. Current law allows anonymous complaints.

Ted Simons:
>> Earlier I spoke with Jessica Pacheco, who supports proposition 202, and Don Goldwater, who is against it. Here is that interview.

Ted Simons:
>> Thank you for joining us on horizon.

Jessica Pacheco:
>> Thanks for having us.

Ted Simons:
>> Jessica, we have an employer sanctions law. Why this?

Jessica Pacheco:
>> The current law that's on the books, we do have one. Immigration has become a national issue. It's the topic of much public debate. Illegal immigration and its ramifications have also been a big part of that debate. Currently in Arizona the people have spoken. They've told us that they want to make sure that employers that are unscrupulous are not getting away with exploiting a certain part of the population. And that's why we have an employer sanctions law. Though the current law that we have is flawed and has multiple loopholes. That's why we have proposition 202 stopping illegal hiring on the ballot this November. And it's going to fix those loopholes and give us an employer sanctions law that is tough, that is fair, and that is enforceable.

Ted Simons:
>> Mending a law that has loopholes sounds pretty good. What's wrong with that idea?

Don Goldwater:
>> Sounds pretty good until you understand the fact that this initiative was brought forth by the wake up Arizona people who are trying to do away with employer sanctions. They hired Jessica's firm, Nathan Sprout, to unseat Russell Pearce, the author of this bill. As a matter of fact, they did the best to assassinate his character all the way on this. Do you really think that this group who believes in these type of tactics would go out and put out an employer sanctions bill? This is a fraud based on the American people, on the people of Arizona. Basically what it does is it takes away the e. Verification system which is extremely important for business.

Jessica Pacheco:
>> I need to break in. It does not take away e-verify.
Don Goldwater:
>> It takes away the e. Verification system.

Jessica Pacheco:
>> It's the choice to use e-verify or i-9.

Don Goldwater:
>> E-verify is there to give businesses a rebuttable defense. Right now businesses who use e-verify have the option or the ability to use an independent third-party sanctioned by the federal government to do the due diligence to determine whether or not the person they are hiring is here legal or not.

Jessica Pacheco:
>> proposition 202, don is confusing issue a little bit. We here in Arizona need an employer sanctions law that is tough and that is fair. Proposition 202 puts forth a law that allows businesses to use e-verify or the i-9 process.

Don Goldwater:
>> the i-9 process as you stated so many times, judge neal wake in the ninth circuit court of appeals is broken. He has come out and said that is one of the most fraudulent documents out there. When you look at the simpson mazoey act -- [overlapping speakers]

Don Goldwater:
>> There's three documents that you can use to verify employment. That would be the i-9, the social security and that would be driver's license. They further say on that thing that you cannot use a document that is not secure. The three most forged documents out there are the i-9, social security and driver's license. Businesses are left wide open. They don't have a leg to stand on. So the prosecutor want to come in, raid their business, go after them and prosecute them. And the price on the federal side is $2,000 a hire and up to 10 years in jail.

Ted Simons:
>> I want to stop right there. Because I think at the core of what we're talking about here is the idea of whether or not federal penalties and punishment, those things are enough, or if what the state -- what the state wants to do regarding licenses is enough. You're too much farther past that?

Jessica Pacheco:
>> No. What I'm saying is we need to give businesses a choice in their hiring processes. E-verify is not mandated, it is a choice as is the current i-9 process. What we're saying is that legal business its here in Arizona that use legal methods of hiring people aren't going to be prosecuted. However I think we're missing the most important piece of this legislation. Those unscrupulous businesses out there that are completely breaking the law, that care not at all about the law, and proposition 200 aggressively goes after those guys. We're talking about the black market cash economy. We're talking about the folks that are engaged in identity theft rings, et cetera. We need to aggressively go after that sort of behavior. And it's not okay. And proposition 202 makes sure that it's not okay.

Don Goldwater:
>> well, steal an identity the way they process stolen identity is that if I'm an illegal immigrant coming into the country and this person is handing me an identity, i-9 social security or driver's license in order to get a job, i have to know that that person doesn't have the authority to give me that identity before it's stolen. It flies in the face of 1324-c. When you sit down and you talk about people who are responsible for employing illegal immigrants, this initiative over here says the head of the business must have prior knowledge before you can classify that business or attack that business for hiring an illegal immigrant. 1324-c doesn't say this person must know or that person must know. U.S.C. 1324, the federal government law says anyone.

Ted Simons:
>> Again, when we started off, the idea was that this would be more enforceable and more fair as far as an employer sanctions law is concerned.

Jessica Pacheco:
>> Why doesn't the current law apply to all businesses? We need a law that applies to everyone. Proposition 202, stop illegal hiring, applies to everyone.

Don Goldwater:
>> No, it doesn't.

Ted Simons:
>> hold on a second. Critics will say that the corporate chains and restaurants and hotels and these sorts of things, the corporations that it doesn't apply. That they are exempt. Are they wrong?

Jessica Pacheco:
>> Completely wrong. They that is not correct.

Don Goldwater:
>> What she is talking about the only thing the state has the authority to do in the penalty phase according to federal government, federal law, is any can only go after the licenses that the state hires. So if you have a business out there that does not have a business license, the state cannot impose fines on that person because only the federal government can do that. Which is one of the things that's into this thing where they talk on their 100-word description, when they say this initiative will collect fines and penalties from people who have violated this initiative. Not this portion of the initiative but this initiative in total. That is against the Simpson Mazoly act. That's why the current law has been upheld in the ninth circuit court of appeals.

Jessica Pacheco:
>> Don, I need to interject. Don and I have had this conversation frequently all over the state. Either you don't understand the law, don, or you're purposely trying to mislead the folks that are listening to our frequent debates. Because there is a fine section in proposition 202. But it is associated with the black market cash economy. It is associated with those businesses that aren't paying taxes and fines are levied there. That is completely constitutional and legal and appropriate.

Don Goldwater:
>> What do I misunderstand when your initiative says fines collected as a result of this initiative will be distributed to schools and hospitals to help deal with the financial burden placed on Arizona because of illegal immigration? Your words, not mine.

Jessica Pacheco:
>> The fine section -- and you're confusing the issue again. The fine section is associated with that's not a cash economy and those businesses that are not paying taxes. And that is completely legal and constitutional.

Don Goldwater:
>> their initiative talks about this issue on the black market cash economy going after people who hire more than four people. If you look at the national studies, the average person that gets picked up on the sidewalk or the home depot or stuff like that is two. So this is a great smoke screen that they're going to come out and go after the cash economy, but it doesn't happen. Additionally, we already have laws on the books.

Jessica Pacheco:
>> we feel if you're going to be shutting down a business, taking away jobs from Arizonans, that the threshold should be higher.

Ted Simons:
>> what do you think, don?

Don Goldwater:
>> Well, I think this is absolutely wrong. We have silent witnesses, it's a program that works on all levels from hard felonies all the way down to light felonies where a person can make an anonymous complaint. The current law as worked out with business and the chamber of commerce says that the attorney general or the county attorney, whoever is looking at this case, may take a non-written complaint, and they may investigate it. They don't have to. A written complaint they are required to.

Ted Simons:
>> Is there a chilling effect with the idea of having to write it down and sign it?

Jessica Pacheco:
>> I certainly hope so. I hope that we're going to get rid of the disgruntled employ you that just wants to cause havoc from a position that he's left. Or perhaps a spouse or perhaps a nonunion shop versus an union shop. We want to get rid of those type of complaints. Because not only do they waste law enforcement's time and resources, but they again potentially put Arizona jobs at risk. The economy is not in great shakes. We need to ensure that we have laws on the books associated with employer sanctions that are tough, that are fair, and that are enforceable. And that's what proposition 202 does.

Jessica Pacheco:
>> Why? Because we aggressively go after the cash economy and those engaged in identity theft. And if a business is engaging in unscrupulous hiring practices, they do not like proposition 202.

Ted Simons:
>> is this not a wise idea to ease in some respects -- we won't call it ease -- we'll just say raising the bars as far as convictions are concerned. For businesses to know that yes, Arizona is serious about illegal immigration, but it's also serious about protecting business?

Don Goldwater:
>> guess what? They already know that. We've had illegals that have been leaving the state for the last two years when these bills were passed. This bill has been upheld in the ninth circuit court of appeals. The only reason this initiative came up is because wake up Arizona could not beat Russell Pearce's bill in a court of law. They brought their own proposition in. The full purpose of this initiative and this proposition is to knock Russell Pearce's law off the books, replace it with their own, and then when it's challenged in a court of law it will be found unconstitutional and be negated.

Jessica Pacheco:
>> Don is rewriting history again. However, what's really important also for our viewers to understand is that this proposition 202 applies to every business, not just some of them.

Ted Simons:
>> okay. And we have to stop it right there. Thank you both for the very spirited discussion. [laughter]

Ted Simons:
>> September is disaster preparedness month both on the national and state level. It's a time when emergency officials are working to inform the public about being prepared for a disaster. Leesa Berens Morrison, director of the Arizona homeland security department, talked about being prepared. Leesa, thank you so much for joining us on horizon.

Leesa Berens Morrison:
>> My pleasure.

Ted Simons:
>> Is September national preparedness month because of 9/11?

Leesa Berens Morrison::
>> Yes. It's tied to 9/11 and the idea is to get the message across to the public to be ready for any type of national or man made disaster.

Ted Simons:
>> Here in Arizona when you talk about disasters, what are we talking about?

Leesa Berens Morrison:
>> Well, they can be either man made or natural. But for the most part we're talking about natural disasters such as a flood, a tornado that we had last month, or even possibly an earthquake.

Ted Simons:
>> In Arizona, we don't get much in the way of things like earthquakes, hurricanes. Do we sometimes get lulled into a false sense of security?

Leesa Berens Morrison:
>> Part of national preparedness month is to make sure that there is not the false sense of security that comes with not having hurricanes and floods very often. So that's what we're trying to do is get the message out to Arizonans that they need to be ready anytime for any type of emergency.

Ted Simons:
>> Now, I know you have a four-part plan you want to talk about for folks to prepare. Let's start with step one.

Leesa Berens Morrison:
>> step one, make a kit. It's probably one of the most important parts about being ready in any type of emergency. And what I've done today is I've brought just three examples of what family should be doing at a minimum to get ready for an emergency. So for example, the most common thing that we talk about is having water for both people that live in your house, yourself, and for pets. And the amount is one gallon per person a day. And that includes also pets. One gallon a day. And you're supposed to have at least enough for three days. So what I'm showing right here is a prepackaged water. We're not necessarily advocating that you go out and get this prepackaged water because it's very expensive. You can find it online at different places. But you can also go to your local store and have water ready in case of an emergency.

Ted Simons:
>> So they have prepackaged water.

Leesa Berens Morrison:
>> They do. Right here.

Ted Simons:
>> Who knew? I also see a heater meal, self-heating meal. Talk to us about that.

Leesa Berens Morrison:
>> Well, there are various types of self-heating meals. There's also meals that don't necessarily have to be heated, they can just be reconstituted or be in a can and you just need to make sure the cans don't expire as well as the meals. But anything can be purchased like this to make sure that you have enough food for three days for your family and for your pets.

Ted Simons:
>> Okay. And one more thing here as a flashlight.

Leesa Berens Morrison:
>> This is a very different flashlight. It doesn't run on batteries, it runs on just being pumped. And then the light goes on for a limited period of time. And then you just keep pumping and keep going. So the idea so to be ready whatever your family needs, that includes medicine, that includes any other special needs, including blankets, extra glasses if you need them, extra contacts, contact solution.

Ted Simons:
>> You don't need a Wal-Mart in your basement. You just need to have things that are available and ready to go in case of an emergency.

Leesa Berens Morrison:
>> making a plan involves communication and a meeting place. Two really important factors. And then practicing both. Communication plan meaning that what are you going to call in case of an emergency? If you're separated and you can't get ahold of your children, your children can't get ahold of you, who do they call? Is it somebody outside the community or inside the community? Maybe you decide two people depending on who they can get in contact. With it's also messaging to your children, be patient. The phone lines may be difficult to get through. Keep trying. Don't give up. But be patient. And then also, practicing both of those things. A meeting place and the communication plan. If there's an emergency you need to be able to set up a predestined meeting place for your family.

Ted Simons:
>> Step three is staying informed. Now, does that mean everything from a transistor radio to keeping the family informed?

Leesa Berens Morrison:
>> There are many methods of staying informed, yes. But using a radio, that would be part of your kit. We highly recommend a portable radio that runs on batteries as opposed to relying on electricity being up and other methods of communication. But being informed is all about personal preparedness. And that's what September is for preparedness month. It's making sure you know what to do. And if people go to our website or the website that's through the state of Arizona that's AZ 211 or our website which is azdohs, and I know you're going to be giving those websites right now. And there's other websites that also give listings for readiness, personal readiness. And that's ready.gov and in Spanish liso.gov. So those forces will make each individual prepared and ready and know what to do in case of an emergency.

Ted Simons:
>> Does the state still have term?

Leesa Berens Morrison:
>> Yes, it does.

Ted Simons:
>> The reverse 9-1-1 system?

Leesa Berens Morrison:
>> Yes, it does.

Ted Simons:
>> What about the 2-1-1 system?

Leesa Berens Morrison:
>> That is activated in an emergency. In 2006 when there was a large fire, the 2-1-1 system was activated. It's not online all the time. There has to be an activation by the governor in the case of an emergency. What happens is like 4-1-1 you call for information, 2-1-1 you call for information with regard to the emergency. Where to go, how to evacuate.

Ted Simons:
>> Very good. Well, great information. Leesa, thank you so much for joining us. We appreciate it.

Leesa Berens Morrison:
>> Thank you.

Ted Simons:
>>
Tomorrow horizon is off as we bring you the first presidential debate provided of course there is a debate. That is it for now. I'm Ted Simons. Thank you so much for joining us. You have a great evening.